Vote No to Austerity Europe – No to the Treaty on Stability, Co-ordination and Governance – Platform of the Campaign Against the Austerity Treaty

The proposed new Treaty on Stability, Co-ordination and Governance in the Economic and Monetary Union– in reality an Austerity Treaty – is an undemocratic attempt to institutionalize austerity across Europe. Its ‘Fiscal Compact’ would deny the right of Member State governments to run a ‘structural’ budget deficit of more than 0.5%. This would remove the democratic right of national parliaments to decide national budgets, with that power shifting to the unelected European Commission and European Court of Justice. This would be a fundamental transfer of power away from elected governments. We call for a ‘No’ vote in the referendum.

The demand for “balanced budgets”, and fines of hundreds of millions of euro for countries which breach EU targets, is an attempt to impose austerity regardless of what government is elected or what mass movements against austerity develop. This attack on democratic rights is part of the same process that has seen elected governments in Greece and Italy replaced by ex-bankers, who represent the interests of the powerful and wealthy.

The proposed Austerity Treaty will not revive the economy or reduce unemployment. It would result in a Europe where millions are out of work for years; where welfare and other benefits are driven down; where education, health and other essential services are cut. It would exacerbate the differences between rich and poor, and between the wealthy core and indebted peripheral countries – shifting the burden of the crisis onto ordinary people.

The proposed Austerity Treaty is a means to compel governments to reduce public spending so as to pay public debt. But public debt has grown because banks have been given €billions to stop them collapsing or because the rich paid little or no tax – not because of excessive spending on public services. Yet the banks and financial markets now insist that governments must become more “credit-worthy”: spending cuts are demanded – to ensure that the state can pay debts that were taken on to bail out the banks in the first place.

Cutting public spending on health, education and welfare will only make the current crisis worse. The economy is in recession, yet €billions of accumulated profits are not being invested productively. Instead, money has gone into financial speculation, which is at the root of the financial crisis and has fuelled the growth of huge debt on the part of households, businesses and states.

In the past, recession and a refusal to invest profits were addressed by state investment in public works. But the Austerity Treaty would prevent states from running deficits to fund public works; it would further reduce economic demand and risks turning this recession into a long-term depression.

The decision on the Austerity Treaty is about the kind of Europe we want: a Europe for the millions or for the millionaires. The real issue in a referendum will not be the Euro or membership of the EU. It will be a choice between accepting an EU Austerity Union, with protection for the wealthy and poverty for ordinary people; or struggling with others across Europe for a People’s Europe, where the priorities are democracy and equality, full employment, social protection and sustainable development.

We call for a ‘No’ vote:

This referendum is about a fundamental transfer of powers and the institutionalization of austerity.

Our alternative to the Austerity Treaty, we call for:

democratic control of decision-making at national and European levels – especially of economic decisions;

the bailed-out banks to be put under public, democratic control – to serve interests of the majority rather than the super-rich minority;

an end to cuts in education, health, social services and welfare benefits; and cuts made since 2008 and those imposed under the EU-IMF must be reversed;

the EU and its member states to prioritize both national and trans-European programs of public works to immediately provide employment and sustainable development.